The journey of life is unique. It never leads to a constant path. Somewhere it’s up somewhere it’s down. Very few of us realise that a boom is always followed by a bust and vice- versa. One day your life is full of excitement and happiness and on the other day you are down and depressed. One day you have a lot of money to spend and on the other day you are left without a penny. Most of us face financial problems in the course of our lives. We weave various dreams to make our lives comfortable and affluent but our income and savings hardly allow us to actualise them. But for those who dare to turn their dreams into reality secured loan is a suitable option.
There can be a number of purposes to get a secured loan. You can renovate your house; buy a new car abandoning the older one, finance your holiday tour, finance your marriage or any other extravaganza. There can be uncountable reasons to get a secured loan. Different kinds of secured loans carry different names such as a car loan, an educational secured loan, secured holiday loan etc.
Secured loans are those loans that are taken against collateral. It means the loan is allotted against some movable or immovable asset of the borrower. In a secured loan the lender is at comfort because he can repossess the property of the borrower in case of repayment of the loan. House owners usually keep their house as collateral so that they can get maximum benefits from the lender.
There are a few advantages and disadvantages attached with the secured loans. In a secured loan the interest rates are kept low. The monthly installments are small and even the repayment period is more in comparison with unsecured loans. On the flip side secured loans carry greater risk for borrowers because they can lose their property in case of non-payment of the loan. Also, the paperwork involved in the process of taking a secured loan is more.
Even though there are some disadvantages attached with secured loans they are still favourable for house owners and others who possess some property. Lenders do not hesitate in giving a large amount of money when they are offered some collateral against it. The less interest rates as well as long repayment tenure are the attractions of secured loans.